Italy Prime Minister will support banks

New Italian Prime Minister Paolo Gentiloni has said in his maiden speech to parliament he’s ready to support Italy’s ailing banks and wants more help from the European Union in coping with migrants.

‘I want to say very clearly that the government … is ready to intervene in order to guarantee the stability of banks and the savings of our citizens,’ he told the Chamber of Deputies on Tuesday, a day after being sworn in by President Sergio Mattarella.

Monte dei Paschi di Siena, Italy’s third-biggest lender, is pressing on with a last-ditch attempt to tap the market for 5 billion euros of fresh cash to stay afloat.

But the state is likely to have to step in to make up the shortfall, bankers say.

A failure of the world’s oldest bank would threaten the savings of thousands of Italians and could have repercussions for Italy’s wider banking sector, which is saddled with 360 billion euros of bad loans – a third of the euro zone’s total.

The softly spoken Gentiloni took over from Matteo Renzi, who resigned last week after Italians rejected his proposed reform of the constitution in a referendum.

The 62-year-old former foreign minister was attacked by the opposition and criticised in the media after he re-confirmed almost all of Renzi’s ministers in his new cabinet.

The main opposition parties, the anti-establishment 5-Star Movement and the right-wing Northern League, say they will take no part in confidence votes in the new government as a sign of protest.

‘They are digging their grave with their own hands,’ said Luigi Di Maio, a 5-Star deputy widely expected to be the party’s candidate for prime minister at the next election.

Gentiloni needs to win confidence votes in both houses of parliament to become fully empowered. The first vote later on Tuesday should be straightforward in the lower house, where the centre left has a comfortable majority.

But he may face problems in the more fragmented Senate on Wednesday, after a small centre-right party that had supported Renzi said it would not back him.

Gentiloni said he would continue Renzi’s battles with the EU, pushing for flexible fiscal rules and more cooperation in sharing out the thousands of migrants who land on Italy’s shores from Africa and the Middle East.

New Italian Prime Minister Paolo Gentiloni has said in his maiden speech to parliament he's ready to support Italy's ailing banks and wants more help from the European Union in coping with migrants.
'I want to say very clearly that the government ... is ready to intervene in order to...